“My Insurance Claim Was Rejected!”, This is How to Overturn it!
Are you one of the many thousands of South Africans who put their hard-earned cash into the hands of insurance companies? Many of us want to believe that regardless of what happens to our assets, if we pay our monthly premium, our insurers will recoup our losses, but is that really the case?
The Ombudsman for Short Term Insurance, otherwise known as OSTI, released their 2018 report stating that last year saw a rather high overturn rate by local insurance companies.
So, what does this mean for the consumers?
The Overturn Rate
The overturn rate is described as the percentage of claims which is overturned by the Ombud against the insurer and which is in favour of the customer.
According to the 2018 OSTI report, the overturn rate for 2018 was at 18%. This is consistent with the previous year’s report. The report also states that 48% of claims made were in the car insurance sector. Overall it should be noted that “in more than two thirds of finalized complaints, consumers complained about the insurer’s decision on a claim”. If you haven’t been happy with your car insurance price or value of the provide, do this 3-minute online car insurance comparison to get instant quotes and see if you could be paying less:
Why is an Insurance Claim Rejected?
Whether you have suffered some form of trauma during the loss or damage to your vehicle, or even if it is just an unnecessary ding, finding out that your insurance claim is rejected can become a real nightmare.
Car insurance companies pride themselves on competitive premiums and ‘unbelievable’ cover, but sometimes this is not the whole truth.
According to OSTI’s report, the most common dispute against insurers was consumers who were unhappy with the monetary reparation they were being offered for their claim car insurance provider.
Other reasons for a rejected claim can be due to the following:
- Your premiums aren’t up to date;
- Driving recklessly or under the influence;
- No write-off cover;
- Tracking and security devices aren’t fitted;
- Vehicle inspection was not carried out appropriately;
- Vehicle was not parked in a secure space at night;
- Vehicle was unlicensed or not roadworthy.
The Financial Intermediaries Association of Southern Africa (FIASA) outlined the importance of transparency between the insurance company and their clientele.
Responding to the OSTI report, FIASA notes that “consumers do not know or understand material terms and conditions contained in their policy documents. This clearly just highlights the need for insurance policy documents to be drafted in clear and simple language. We wonder why many insurance companies make it so difficult to read and understand the policy document, is it so that they can leave room to reject the claim?
Many insurance policies signed off between the client and their insurer have not been explained to the client in layman’s terms. This opens the door to possible altercations due to unclear terms and conditions when the client’s claim is rejected.
My Claim Was Rejected, Now What?
If you have ever had to claim from your insurer for damages done to your vehicle, you would know that it is a stressful task.
However, you are not alone. Thousands of claims are made to insurance companies every month, however many of them are rejected.
In fact, during the period of 2017/2018 alone, just under 10 000 claims were rejected by insurers across the country.
So, here’s what to do if your claim has been rejected:
- Check that your claim is actually covered
Make sure that what you are claiming for is, in fact, covered and that it is in writing. For example, if your car was hijacked and in your policy your car was required to be fitted with a tracking device, make sure the device was fitted and functions correctly.
- Talk it over with your insurer
If your claim was rejected by your insurer and you are unsure as to why -give them a call. By law all car insurance companies are required to take their clients through a formal complaints process if they are unhappy with the service they have received. Remember however, that many of these companies are huge corporations with thousands of employees, so be sure to write down the person who you have been dealing with in order to eradicate confusion.
- Tell the truth
Ensure that from the start, you are clear of your story and that it is 100% truthful. Provide the insurance company with all your particulars and, although it might be frustrating, repeat all the policy numbers to be sure that they are on the same page as you.
- Still unhappy? Call up the Loss Adjusters
Ever heard of the Institute of Loss Adjusters of Southern Africa or ILASA for short? Well don’t worry, neither had we. If your insurer is still not giving into your claim, the ILASA is an independent body which provides consumers with an independent and objective assessment of the damage to your vehicle. Once the vehicle has undergone an evaluation, the adjuster can send a report to your insurer, however the insurer is still not obligated to pay for damages. You can however use this when discussing your premium.
- OSTI here we come
If none of the previous steps have worked, the last step would be to submit a complaint to the short-term insurance ombudsman. By going on the OSTI website or clicking on this link(https://www.osti.co.za/lodge-a-complaint/), you can either complete an online application form or download one to print and mail through.
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